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China Insights

Monthly update on Chinese markets
08 February 2021
    Download the full reportPDF, 816.79KB

    Summary

    • The recent liquidity tightening is as part of counter-cyclical policy adjustment in response to market conditions and economic data, rather than sending asset bubble warning or policy tightening signals, in our view
    • We continue to expect the reduction in virus risk due to mass vaccination coupled with swift policy response to support the ongoing recovery in consumer spending and strong growth for 2021
    • Policymakers are expected to strike a balance between supporting economic recovery and preventing risks such as an increase in the macro leverage ratio, growing non-performing loans, and external uncertainty